Saudi Arabia’s Draft Insurance Law: What It Means for Actuarial Services

July 2025

The Saudi Insurance Authority has recently released a landmark draft of its new Insurance Law, marking a significant shift in the regulatory framework for the Kingdom’s growing insurance sector. This long-awaited legislation - currently under public consultation - signals Saudi Arabia’s strategic intent to align with international best practices, strengthen consumer protection, and improve financial stability across the industry.

At Royal Falconian Actuaries, we believe this legislative shift has important implications for actuarial services, particularly in areas such as reserving, capital adequacy, pricing, reinsurance, and regulatory reporting.

Key Highlights of the Draft Insurance Law

The new law proposes a consolidated, principles-based approach that enhances oversight while promoting market development. Key features include:

• Expanded regulatory scope: The law applies not just to insurance and reinsurance companies, but also to insurance-related service providers—including actuaries.

• Stronger solvency and reserving standards: A more robust framework for capital adequacy, risk-based solvency, and technical reserves is anticipated.

• Governance and disclosure requirements: Enhanced expectations for governance, internal controls, and reporting to ensure transparency and policyholder protection.

• Penalties and enforcement powers: The Insurance Authority will have increased powers to enforce compliance and take corrective action.

These changes are consistent with global trends, such as the Solvency II regime in Europe, and underscore the Kingdom’s commitment to transforming the financial services sector under Vision 2030.

Implications for Actuarial Work in Saudi Arabia

The draft law highlights the growing role of qualified actuaries in Saudi Arabia’s insurance ecosystem. With increasing demands for technical accuracy, risk-based decision-making, and audit-ready valuation models, actuaries are essential to:

• Valuing insurance liabilities using best-estimate assumptions and prudent margins.

• Supporting regulatory capital modelling in line with new solvency requirements.

• Designing pricing strategies that are fair, sustainable, and backed by data analytics.

• Conducting reinsurance analysis to optimise capital relief and risk transfer.

• Delivering actuarial function reports as required under evolving regulatory rules.

The new regulatory expectations will likely increase demand for independent actuarial consultants with international expertise and local market understanding.

Final Thoughts

The release of Saudi Arabia’s draft Insurance Law is a major step in modernising the Kingdom’s insurance sector. As the regulatory landscape becomes more sophisticated, actuarial services will play a central role in ensuring compliance, financial strength, and long-term profitability.

Now is the time for insurers and related service providers to strengthen their actuarial capabilities and partner with firms that understand both the technical demands and regional dynamics of the market.

To learn more about how Royal Falconian Actuaries can support your actuarial needs in Saudi Arabia, visit www.royalfalconian.com or contact us for a confidential discussion.